Fed’s Powell: Sustained Higher Rates Necessary for Fed Policy Decisions – Reuters

By Michael S. Derby

Federal Reserve Chairman Jerome Powell stated on Wednesday that for future monetary policy decisions to be influenced by market borrowing costs, those costs would need to be consistently higher over time.

Powell noted that tighter financial conditions could impact the Federal Reserve’s actions if they persist. However, he acknowledged that it is yet to be determined if this will occur. He also mentioned that rising yields in the Treasury market are increasingly affecting real-world borrowing costs. This was expressed during a press conference that followed a two-day meeting of the Federal Open Market Committee focused on interest rate policy.